CREDIT CARD vs DEBIT CARD (DIFFERENCE BETWEEN CREDIT CARD & DEBIT CARD)- 2018 DEC

COMPARE BETWEEN CREDIT CARD AND DEBIT CARD & WHICH IS THE BEST. WHY YOU SHOULD CHOOSE ONE OVER OTHER?

Table of contents

1.CREDIT CARD VS DEBIT CARD (IN TABULAR FORMAT)
2.CREDIT CARD VS DEBIT CARD ( If you could not understand tabular form then read details explanation)
3. PRO TIPS TO CHOOSE WHICH CARD FOR WHICH PURPOSE?

1. CREDIT CARD VS DEBIT CARD TABLE

CREDIT CARD	DEBIT CARD
1. IN CREDIT CARD YOU HAVE TO BORROW MONEY FROM YOUR CARD PROVIDER	1. IN DEBIT CARD YOU HAVE TO PAY MONEY FROM YOUR BANK ACCOUNT DIRECTLY.
2. YOU CAN SPEND MORE MONEY THAN YOUR LIMIT USING CREDIT CARD	2. YOU CANNOT SPEND MORE MONEY THAN YOUR TOTAL BALANCE.
3. WHEN YOU SWIPE THE CARD THE CARD COMPANY PAYS	3.WHEN DEBIT CARD IS SWIPED MONEY DEDUCTED DIRECTLY FROM YOUR BANK ACCOUNT.
4. GETTING CREDIT CARD IS NOT EASY.	4. GETTING A DEBIT CARD IS EASY & MOST OF THE PEOPLE USE DEBIT CARD.
5. CREDIT CARD KNOWN AS LOAN CARD	5. DEBIT CARD KNOWN AS ACTUAL/BALANCE CARD
6. YOU CAN PURCHASE EVEN IF YOU DON'T HAVE FUND(MONEY)	6. YOU CANNOT PURCHASE USING DEBIT CARD IF YOU DON'T HAVE FUND (MONEY)
7.CHARGES/PENALTY FOR MAKING LATE PAYMENT.	7. FOR OVERDRAFT (PURCHASING MORE THAN BALANCE MONEY) DEBIT CARD COMP
8. BETTER FRAUD & THEFT PROTECTION	8. FRAUD EASILY CAN HAPPEN

It is really easy to find if a card is debit card or credit card. "All credit or debit cards have EITHER CREDIT CARD OR DEBIT CARD WRITTEN ON THEM"

2. CREDIT CARD VS DEBIT CARD DETAILS EXPLANATION

1. CREDIT CARD 

• The credit card is known as a loan card. You have to borrow money from the credit card company (ex- VISA, MASTERCARD, AMERICAN EXPRESS etc)
• After borrowing money you have to pay money to the company at the end of the month.
• You need to pay more interest to the company if you pay money lately. (Interest rate is high you cannot afford if you are not rich)
• HOW CREDIT CARD WORKS:--- If you buy 100$ item from Walmart store then your credit card company will give the money to the Walmart when you swipe the card & credit card company will charge that amount of money from you at the end of the month (or mutually fixed date)
• You can purchase more than your actual bank balance but you have to pay that amount to the card company. 
• Late payment can decrease your credit card score. 
• You need to INCREASE YOUR CREDIT SCORE (POINTS) if you are using a credit card.
• Credit card limit decided by the credit card company. If you have a good score then the company will increase the limit (you can purchase more)
• If you purchase something using a credit card then it takes some days to transfer money to the bill. 
• A credit card is more secure against frauds or lost-stolen cases because it takes weeks to transfer money to your bill. (If you contact credit card company immediately then can stop the transfer of money & can block that card easily)
• Credit card issuing companies charge interest for the late fee.
• Applying for a credit card is bit complex as credit card companies check your capacity, credit score etc.
• You will rarely get any approval if you have a low credit score or bad reputation with previous credit card issuing company.

PROS OF CREDIT CARD 

1. More secure
2. You can spend money without thinking about balance
3. Good if you are doing a high amount of transactions

CONS OF CREDIT CARD

1. For rich guys.
2. Credit card companies charge a heavy amount of money.
3. Not approved easily.

2. DEBIT CARD 

• The debit card is known as balance card. No need to borrow money from anyone.
• You cannot use more money than your total bank balance to purchase something.
•  The debit card also has a system where you can purchase more than your total bank balance and it is known as OVERDRAFT.
• To use overdraft feature you need to talk with your card provider.
• You need to pay extra money for using the overdraft feature.
• HOW DEBIT CARD WORKS:- When you purchase something using debit card money get deducted from your bank balance directly.
• You don't need to pay any interest if you are not using any overdraft feature.
• It is not secure against frauds as money get deducted faster than a credit card.
• Easy approval.

PROS OF DEBIT CARD 

1. You can spend more money than your total balance using overdraft feature.
2. You spend money cautiously.
3. No need to pay interest if you are not using overdraft feature. (middle-class friendly)
4. Easy approval

CONS OF DEBIT CARD 

1. Not secure compared to credit card
2. Most of the time You cannot pay more money than your bank balance.

3.PRO TIPS:-

1. WHICH CARD I SHOULD CHOOSE IF I AM VISITING FOREIGN COUNTRY?

You can use both credit card and debit card. But never forget to keep local cash of that country in your purse.

2. WHICH IS BETTER CREDIT CARD OR DEBIT CARD?

Both are becoming better nowadays. But a credit card is for rich & extravagant. 

3. WHAT IS THE SIMILARITY BETWEEN DEBIT CARD AND CREDIT CARD?

Both are the same size, both are allowed in most of the places, both carry the logo of  issuing company (VISA, MASTERCARD etc..)

4. WHEN CREDIT CARD IS BETTER THAN DEBIT CARD AND DEBIT CARD IS BETTER THAN CREDIT CARD?

A credit card is good for you if you spend high amount of money and rich enough to repay with interest.

A debit card is good for 9-5 job people.


5. WHEN YOU SHOULD USE CREDIT CARD AND WHEN YOU SHOULD USE DEBIT CARD?

Use credit card for big purchases or frequent purchase (if you are spending money regularly)

Use debit card if you rarely purchase anything.